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How much would you pay for 20-year, 8% annual coupon paid with semiannual frequency, and face...

How much would you pay for 20-year, 8% annual coupon paid with semiannual frequency, and face value of 1000 bonds? Nominal annual interest rate is 7%. Show Calculations

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Answer #1
                  K = Nx2
Bond Price =∑ [(Semi Annual Coupon)/(1 + YTM/2)^k]     +   Par value/(1 + YTM/2)^Nx2
                   k=1
                  K =20x2
Bond Price =∑ [(8*1000/200)/(1 + 7/200)^k]     +   1000/(1 + 7/200)^20x2
                   k=1
Bond Price = 1106.78
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